Congress should include a subsection as part of IRC 6331 to read as follows:

    Recognizing that the fair and equitable administration of the
    internal revenue laws is important to voluntary compliance, the
    Secretary shall issue regulations specifying the circumstances,
    conditions, and situations under which a levy will be made.

Reasons for Change:

In the January 1976 report of the Administrative Conference of the United States, entitled "Collection of Delinquent Taxes," it was pointed out that the IRS had no clear guidelines specifying when levy action was to be taken. The following is taken from page 96:

    The emphasis on numbers gives rise to more serious possibilities
    of abuse, such as the instances reported by Internal Audit of
    seizures of property in which the taxpayer was known to possess
    no equity. In each case the property was returned without
    payment of the tax. Such action exposes the Service to
    suggestions that it is misusing its powers and thus may tend to
    diminish voluntary compliance by the .public-a damaging result
    for our self assessment system of taxation.

    Lacking guidance, revenue officers vary in their criteria for
    seizure of assets of individual taxpayers. Some told us that they
    will seize only when they expect to make forced sale of the seized
    assets. Other claimed to seize only when it was anticipated that the
    taxpayer would redeem the property. A few mentioned making seizures
    to impress the taxpayer with the serious consequences of not meeting
    his tax obligation. So long as the Internal Revenue Service fails to
    delineate clear purposes for the use of summary powers, we believe
    that these divergent criteria will continue to exist. The variations
    in practice may lead to the appearance of arbitrariness and caprice
    in some actions, thus undermining the taxpaying public's confidence
    in (and compliance with) the taxing system.

Two years after that report was issued, on July 31, 1978, the GAO issued a report entitled: "IRS Seizure of Taxpayer Property: Effective, But Not Uniformly Applied." It reported that the decision to seize is made for different reasons in different districts, and pointed out that the IRS still did not have clear guidelines on when a levy or seizure should be made.

In an internal memorandum to the Director of the Collection Division, dated May 28, 198O, the Chief of the Evaluation and Research Branch stated that the:

    Statistics confirm a wide range of variation in the use of
    enforcement actions by individual districts. The variation does
    not appear to be random; rather, patterns of high frequency or
    low frequency tend to remain in specific districts over a number
    of years ... Levy actions are used by revenue officers in a
    multitude of conditions. The Internal Revenue Manual does not
    specify conditions requiring levy or seizure actions. It
    outlines some mandatory technical requirements and stresses
    efficient and fair employment of such tools. We rely heavily
    upon the independent judgment of the revenue officer. Of course,
    these judgments are not made in an influence-free environment.
    Collection management can influence and monitor the revenue
    officer decisions.

Hearings before the Senate Subcommittee on Oversight of Government Management of the Committee on Governmental Affairs on July 31, 1980, revealed that supervisory pressure to produce enhanced enforcement statistics resulted in intolerable abuses of taxpayers' rights, a disregard for the judicious exercise of the levy power, and numerous violations of IRS policies and procedures. In effect, various districts have contravened national policies with their own guidelines, written and unwritten.

It is necessary for the national office to ensure fair and equitable treatment of all taxpayers by issuing guidelines on the proper use of the levy powers. As it has been over six and one-half years since the situation was brought to light, this would suggest that the national office is not interested in meeting its responsibilities as the agency's chief policymaker, nor is it much interested in fulfilling its mission to provide "for the uniform interpretation and application of the tax laws." Since the IRS has not been responsive enough to issue seizure guidelines, Congress should direct them by statute to do so.